MBL Group H1 Loss From Continuing Operations Widens, Shares Down

12/28/2012 6:44 AM ET

Shares of MBL Group Plc (MUBL.L) dropped about 11 percent Friday morning, as it reported a wider loss from continuing operations for the first half, reflecting lower revenues and higher costs and expenses. The company said its performance in the period was challenging, particularly in its core home entertainment market.

MBL noted that its board has continued with its strategy of transitioning the Group towards direct to consumer sales and to reduce the reliance on the home entertainment sector.

For the first half ended September 30, 2012, the company posted a pre-tax loss from continuing operations of 1.05 million pounds, wider than 0.7 million pounds reported in the previous year.

Loss before tax, including discontinued operations, was 1.1 million pounds, compared to 7.2 million pounds in the prior year.

On a per share basis, loss was 6.4 pence, compared to 43.9 pence per share last year. Loss from continuing operations widened to 6.2 pence per share from 4.7 pence per share in the preceding year.

The company said its half-yearly results were impacted by final stages of wind down and implementation of new strategy following loss of major contract in 2011.

Chairman Peter Cowgill stated, "The Group has experienced a period of significant change within the reported six months whilst it focused on the integration of newly acquired businesses and adapting its existing businesses to the ongoing challenges within the home entertainment industry. The Group has made progress towards completing the wind down of its discontinued operations and is better positioned to focus on its future."

Revenues for the period declined 8.8 percent to 7.25 million pounds from 7.97 million pounds in the same period a year ago. Revenue, including discontinued operations, decreased to 7.4 million pounds from 15.7 million pounds last year.

Administrative expenses surged to 2.61 million pounds from 1.83 million pounds a year earlier.

MUBL.L is currently trading at 8.5 pence, down 10.53 percent, on a volume of 28,281 shares on the LSE.